Bay Area Fraudster Convicted Of Duping Investers Out Of More Than $3 Million
SAN FRANCISCO- A federal jury convicted Marc Christopher Harmon today of conspiracy to commit wire fraud and five counts of wire fraud, announced United States Attorney Brian J. Stretch, Federal Bureau of Investigation Acting Special Agent in Charge Bertram Fairries, and Internal Revenue Service, Criminal Investigation, Special Agent in Charge Michael T. Batdorf.
Harmon, 43, of San Leandro, Calif., was charged, along with co-conspirator Jason George Rivera, Jr., 37, of Danville, Calif., in a scheme to defraud multiple investors of more than $3 million between October 2008 and January 2011. In an indictment filed July 3, 2014, Harmon and Rivera were accused of using a Nevada corporation known as Executive Members Management Group, or EMMG, as a vehicle to defraud investors. The scheme involved promises that EMMG would purchase or trade collateralized mortgage obligations (CMOs) using funds provided by the investors, or would invest their funds in other lucrative transactions. Rivera and Harmon convinced victims to invest substantial sums of money, by promising, among other things, high rates of returns by participating in exclusive trading markets overseas and funding short-term loans for banks.
The evidence at trial demonstrated that Harmon’s role in the conspiracy was to recruit investors to EMMG. Harmon made many false representations to induce the investors to invest. These false representations included representations about Rivera and Harmon’s investment expertise, connections, history, and success; about the historical returns generated by the particular investment programs for which investments were being solicited; about future returns expected, promised, or guaranteed by these transactions; about the “blocked” nature of the transactions, wherein their funds would be held in something like an escrow account, would never leave EMMG’s account, and thus would be entirely safe; about the short time periods for payout (days, weeks, or a month, generally); and about how Rivera and Harmon would only be paid after the transactions returned a profit for the customers. In reality, there were no actual investment programs overseas, and both defendants simply spent investors’ money as it came in, and then lied about it for months and months afterwards.
On July 3, 2014, a grand jury returned an indictment charging defendants with eight counts of wire fraud, in violation of 18 U.S.C. § 1343, and one count of conspiracy to commit wire fraud, in violation of 18 U.S.C. § 1349. Rivera also was charged with two counts of tax evasion, in violation of 26 U.S.C. § 7201.
On July 29, 2015, Rivera pleaded guilty to the conspiracy to commit wire fraud charge and the two tax evasion counts. The government dismissed two counts of fraud, as it related to Harmon and the jury convicted Harmon of each of the remaining charges. Harmon now faces a maximum statutory penalty of 20 years in prison, a fine of $250,000, forfeiture, and restitution for the conspiracy charge and for each of the five wire fraud counts. However, any sentence following conviction would be imposed by the Court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
The guilty verdict followed a one-week jury trial before the Honorable Richard Seeborg, U.S. District Judge. The trial got off to a shaky start when Harmon failed to appear on the first day and Judge Seeborg issued a warrant for his arrest. FBI and IRS agents were prepared for his possible failure to appear, and Harmon was arrested and in custody within 20 minutes of Judge Seeborg issuing the arrest warrant. Harmon remains in custody pending his sentencing scheduled for August 23, 2016, before Judge Seeborg.
Assistant U.S. Attorneys Benjamin Kingsley and Shailika Kotiya are prosecuting the case with the assistance of Jessica Meegan. The prosecution is the result of an investigation by the FBI and IRS, Criminal Investigation.